Non-working KPIs in IT: what they can cause and how to choose the right ones. Algorithm for creating KPIs

Algorithm for creating KPIs

  1. Following the strategic goal. The strategy is to increase customer satisfaction and loyalty to the existing IT product. Its quality is one of the key success factors. Therefore, despite the addition of new functionality, it is necessary to increase the coverage with unit-tests
  2. Definition of the current and target values. Example: the current coverage level of code by unit-tests — 30%, whereas the target, recognized industry standard — 80%
  3. Obtaining metric data. Metric values should be calculated as easily as possible and preferably automatically. In the example with unit-tests, this should be done with SonarQube, correctly configured and included in the general CI/CD-process of the project;
  4. Determination of the KPI weight. For a coherent process, an employee or team need to work on several goals at once. For example, the product quality, the time between the generation of a business idea and its implementation, the introduction of innovative ideas, etc.
  5. Frequency of updates. It is reasonable to revise targets and the weight of KPIs in the overall set at regular intervals. Depending on the business situation, it makes sense to update these indicators once a month or a quarter, not more often. Employees should be notified about such changes in advance, not ex post. Moreover, this information should not be hidden
  6. Life time. If the strategic goal of the company has been achieved or the KPI has ceased to bring the expected benefit, or maybe it simply has been chosen incorrectly, this metric should be abandoned and another one should be introduced; the one, which will show the business situation with a plan for the future.

Examples of the right KPIs for the IT industry

  • 99.9% — for a year (365 days) the application in total did not work a little less than 9 hours
  • 99.5% — just under two days
  • 99.0% — less than four days
  • Reduction of financial costs (per year) for support of the application
  • The benefits of moving to a new platform or technology

So, what are the conclusions from all of the above?

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